Finance Minister Pravin Gordhan in December instructed the South African Revenue Service (Sars) to halt its extensive restructuring plans.
Treasury spokesperson Phumza Macanda told Fin24 on Thursday that Gordhan asked Sars commissioner Tom Moyane at a meeting in December to suspend his ambitious plans.
“He met briefly with Sars management in December and yes, he asked that major initiatives be put on hold until he’s had time to assess the situation fully,” she said.
“He is yet to be brought up to speed so there haven’t been any major decisions as yet,” she said.
“When he does (make a decision), it will be with the view to strengthen the institution,” she added. “The importance and stability of Sars in the SA economy is paramount and whatever decision the minister makes, it will be in that context.”
She said that as the newly-appointed minister, Gordhan had to meet with all entities that report to him so he could be properly briefed to assess the situation. That was the context in which the first meeting with Sars took place.
Shortly after President Jacob Zuma reappointed Gordhan on December 13 after his disastrous firing of Nhlanhla Nene, the former Sars commissioner paid a “courtesy visit” to Sars, where the above directive was given.
Gordhan served as commissioner of Sars for 10 years between 1999 and 2009, when he was promoted to finance minister. Zuma shifted him to the Department of Cooperative Governance and Traditional Affairs in 2014, promoting Nene to head up Treasury.
In 2015, Sars attempted to pull Gordhan into the alleged rogue spy unit investigation at Sars.
During his press conference on December 14, Gordhan slammed auditing firm KPMG over a leaked report that appears to confirm allegations regarding the unit.
"It's allegations that have no foundation. They are based on a leaked document that even I haven't seen," he said.
"How would you like to be accused of something on the basis of a document that has not been put to you or... questions that have not been put to you, on the basis of no opportunity having been put to you to say what the facts of the matter are? One thing I would like to request from you is to stop reporting on rumours."
The unit was accused of running a brothel and spying on Zuma, among other things.
"Where is this mysterious report? KPMG has a cheek to say he [Gordhan] doesn’t know anything but he should know. I thought forensic people are supposed to come up with facts. What does that say about the reputation of KPMG?" Gordhan asked.
Business Day newspaper reported on Thursday that Gordhan and Moyane’s relationship got off to a rocky start after the commissioner’s “purging of top Sars executives allegedly implicated” in the unit.
“The plan (to restructure Sars) involved the introduction of a new operating model for Sars based on the recommendations of a review into its functioning, processes and practices conducted by consultants from Gartner, Bain & Company and KPMG,” Business Day reported.